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BANCROFT 
LIBRARY 

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THE  LIBRARY 

OF 

THE  UNIVERSITY 
OF  CALIFORNIA 


SUTRO  TUNNEL. 


MINORITY    REPORT 


MR. 


REVIEWED. 


In  his  minority  report,  covering  less  than  two  printed  pages,  Mr,  Sar- 
gent refers  to  the  Sutro  Tunnel  fifteen  times  as  "the  corporation," 
while  the  Bank  of  California  is  spoken  of  thirteen  times  as  "the 
miners." 

The  fact  is,  that  the  Sutro  Tunnel  Company  is  largely  composed  of 
the  laboring  miners,  all  of  whom  warmly  support  the  measure,  while  the 
Bank  of  California  is  well  known  to  be  the  most  gigantic,  unscrupulous, 
and  oppressive  corporation  within  the  United  States. 


WASHINGTON,   1).  C. 

M'GILL  &  WITHEROW,  PRINTERS  AND  STEREOTYPERS. 
1873. 


SUTRO  TUNNEL. 


MIJSTOEITT    EEPOET 


BY 


M:R. 


REVIEWED. 


In  his  minority  report,  covering  less  than  two  printed  pages,  Mr,  Sar- 
gent refers  to  the  Sutro  Tunnel  fifteen  times  as  "the  corporation," 
while  the  Bank  of  California  is  spoken  of  thirteen  times  as  "the 
miners." 

The  fact  i»,  that  the  Sutro  Tunnel  Company  is  largely  composed  of 
the  laboring  miners,  all  of  whcm  warmly  support  the  measure,  while  the 
Bank  of  California  is  well  known  to  be  the  most  gigantic,  unscrupulous, 
and  oppressive  corporation  within  the  United  States, 


WASHINGTON,  D.  C. 

M'GILL  &  WITHEROW,  PRINTERS  AND  STEREO TYPEKS. 
1873. 


c<*o" 


THE  SUTRO  TUNNEL. 


ARGUMENTS  DISPROVED    BROUGHT  FORTH    AGAIN— MINORITY 

REPORT  OF  THE  COMMITTEE  ON  MINES  AND 

MINING  REVIEWED. 


For  the  last  seven  years  the  Bank  of  California,  as  shown 
by  the  following  extracts,  has  waged  an  unrelenting  war 
against  the  construction  of  the  Sutro  Tunnel,  the  most  im- 
portant and  interesting  work  now  in  progress  on  this  conti- 
nent. The  work  being  of  a  highly  laudable,  meritorious, 
and  national  character,  such  war  could  only  be  successfully 
carried  on  by  willful  misrepresentations  and  misstatements 
a  thousand  times  repeated.  In  order  to  set  these  finally  at 
rest,  a  commission  was  sent  out  to  examine  and  report  the 
facts ;  and  these  commissioners  even,  by  the  strenous  efforts 
of  the  agents  of  the  Bank,  were  misled  in  some  important 
particulars.  This  induced  the  Committee  on  Mines  and 
Mining  to  examine  the  commissioners,  as  well  as  other 
experts,  in  person,  for  the  purpose  of  getting  at  the  whole 
truth.  The  examination  lasted  during  several  months ;  the 
testimony,  embracing  800  pages,  has  been  submitted  to 
Congress,  and  proves  conclusively  that  the  allegations  made 
by  the  Bank  of  California  are  not  based  upon  facts.  The 
views  of  the  majority  of  the  committee,  consisting  of  eight 
members,  are  embraced  in  their  report.  The  minority  re- 
port is  made  by  Mr.  Sargent  alone. 

THE  MINORITY  REPORT  ANALYZED. 
.  Mr.  Sargent  says: 

I.  "The  bill  agreed  upon  by  the  majority  is  prefaced  by  a  pre- 
amble, containing  six  distinct  recitals,  some  of  which  are 
untrue,  and  all  of  which  are  immaterial." 

The  following  is  the  preamble,  which  speaks  for  itself: 


"  Whereas  our  public  lands  contain  mines  of  the  precious  metals  which  are 
unsurpassed  in  extent,  and  can,  with  proper  development,  be  made  speedily 
to  enhance  the  value  of  all  property,  and  thereby  relieve  the  burdens  of  the 
people;  and 

"  Whereas  a  wise  policy  indicates  that  the  revenue  derived  from  our  mineral 
lands  should,  to  some  extent,  be  devoted  again  to  the  much-needed  develop- 
ment of  that  important  interest;  and 

"Whereas  Congress,  by  an  act  approved  July  twenty-fifth,  eighteen  hun- 
dred and  sixty-six,  authorized  the  construction  of  a  draining  and  exploring 
tunnel  to  the  Comstock  lode,  in  the  State  of  Nevada,  and  granted  to  Adolph 
Sutro  certain  rights  and  privileges,  which  have  been  assigned,  transferred, 
and  set  over  to  a  corporation,  duly  organized  under  the  laws  of  the  State  of 
California,  and  known  as  the  Sutro  Tunnel  Company ;  and 

"  Whereas  great  benefits  will  accrue  to  the  people  of  the  United  States  from 
the  construction  of  said  tunnel,  which,  as  a  great  geological  survey,  penetrat- 
ing into  an  argentiferous  mountain  to  a  greater  depth  than  has  yet  been 
reached  by  any  similar  work  in  the  world,  will  establish  the  value  of  our 
mineral  domain ;  and 

"Whereas  the  principal  wealth  of  our  mineral  regions  consists  in  low-grade 
ores,  which  can  only  be  utilized  by  means  of  improved  reduction,  concentra- 
tion, and  smelting  works,  for  the  erection  of  which  extraordinary  facilities 
exist  at  the  mouth  of  said  tunnel;  and 

"Whereas  this  work  bears  a  national  character,  and  its  magnitude  is  beyond 
the  capacity  of  private  enterprise,  and  the  security  offered  to  the  Government 
is  ample  for  the  repayment  of  any  sums  to  be  advanced  under  this  act:  There- 
fore, be  it  enacted,"  etc.,  etc. 

2.  "  Congress  has  already  granted  to  Sutro  and  his  corporation 

franchises  that  for  speculative  purposes  he  claims  are 
worth  over  six  millions  of  dollars  a  year." 

Congress  has  granted  certain  franchises,  which  are  of 
no  value  unless  the  tunnel  is  completed ;  and  if  they  he  then 
worth  six  millions  of  dollars,  they  offer  most  excellent  secu- 
rity for  a  loan  of  two  millions  of  dollars. 

3.  "These  grants  were  made  on  the  assurance  that  the  corporation 

would  go  on  and  construct  its  tunnel,  and  thus  develop  all 
there  was  to  be  developed  of  the  Comstock  lode.  This 
has  not  been  done." 

The  most  persistent  and  strenuous  efforts  were  made  for 
years  to  carry  out  the  work,  which  would  have  been  com- 
pleted long  before  this  time,  had  it  not  been  for  the  con- 
tinued, unscrupulous,  and  powerful  efforts  of  the  Sank  of 
California  to  prevent  it. 


(See  Prof.  Newcomb's  testimony,  page  137.*) 

"Q.  (By  Mr.  SUTRO.)  You  spoke  of  Mr.  Sharon  a  moment  ago,  the  agent 
of  the  Bank  of  California.  Did  he  ever  say  anything  to  you  about  being 
opposed  to  the  tunnel? 

"A.  Well,  he  expressed  himself  very  strongly  when  I  first  saw  him  in 
the  street  in  connection  with  the  other  commissioners. 

"Q.  When  you  were  introduced  to  him? 

"A.  He  did  not  address  himself  to  me,  but  he  expressed  himself  as  very 
strongly  against  the  tunnel? 

"Q.  On  what  grounds  did  he  state  he  was  opposed  to  it? 

"A.  The  grounds  were  not  given,  only  he  would  crush  it,  or  something  to 
that  effect. 

"  Q.  Did  he  make  any  remark  to  the  effect  that  he  would  break  it  up,  or 
oppose  it,  if  he  could? 

"A.  Yes,  in  very  strong  terms.  I  cannot  use  the  very  words  he  did,  but 
I  know  the  expression  was  very  strong." 

(See  Major  General  H.  Gr.  Wright's  testimony,  page 
210.) 

"Q.  (By  Mr.  SUTRO.)  Did  Mr.  Sharon  in  his  intercourse  with  you  express 
any  violent  opposition  to  the  tunnel? 

"A.  He  expressed  an  intention  of  opposing  it  certainly,  as  being  in  oppo- 
sition to  his  own  interests. 

"Q.  Did  he  say  he  was  going  to  break  it  up  if  he  could? 

"A.  I  do  not  think  he  went  so  far  as  that.  He  said  he  meant  to  oppose  it. 

"Q.  Now,  General,  let  me  quote  here  from  a  speech  of  Governor  Blair,  of 
Michigan,  in  the  House  of  Representatives,  in  which  he  uses  the  following 
language : 

"Mr.  SUNDERLAND.  I  would  like  to  have  that  whole  speech  taken  down. 

"Mr.  SUTRO.  All  right;  we  will  take  down  the  whole  of  it:  I  want  to  ask 
General  Wright  whether  that  agrees  with  his  view  or  experience  over  there. 

"Mr.  BLAIR.  The  tunnel  was  not  then  begun,  but  when  I  was  there  I  heard 
a  very  diligent  discussion  of  the  question.  The  gentleman  whose  name  has 
been  mentioned  in  this  discussion,  Mr.  Sharon,  the  agent  of  the  Bank  of  Cali- 
fornia at  the  Comstock  lode,  took  me  in  his  buggy,  and  carried  me  to  his 
crushing-mills,  and  showed  me  the  line  of  the  new  railroad  he  was  building, 
or  rather  got  the  people  to  build  for  him.  He  took  me  to  his  "mines — to  the 
very  bottom  of  them — showed  me  all  about  them,  and  told  me  he  was  deter- 
mined the  Sutro  tunnel  business  should  be  stopped." 

Then,  in  closing  his  speech,  Mr.  Blair  said: 

"Sir,  this  Bank  has  waved  its  hand  over  the  Comstock  lode  and  ordered  Sutro 
away.  That  is  the  whole  of  this  transaction,  as  it  seems  to  me. 

"Q.  General  Wright,  did  you,  sir,  in  your  intercourse  with  Mr.  Sharon, 
hear  any  similar  expressions  to  that? 

*A11  references  are  to  official  edition  of  the  Testimony,  printed  by  order  of  Congress. 


6 

"A.  I  heard  Mr.  Sharon  express,  over  and  over  again,  his  opposition  to  the 
tunnel  project. 

" Q.  Did  he  say  he  was  going  to  stop  it? 

"A.  I  have  no  recollection  of  his  saying  that. 

"Q.  Did  he  say  he  would  try  to  break  it  up;  or  didn't  you  arrive  at  that 
conclusion  from  his  statement? 

"A.  I  arrived  at  the  conclusion  that  he  would  do  everything  in  his  power 
to  prevent  the  project  being  carried  out. 

"  Q.  Do  you  think,  then,  he  would  try  to  set  aside  a  law  of  Congress? 

"A.  I  certainly  do;  but  how  he  was  to  proceed  about  it  of  course  I  do  not 
know.  I  had  some  conversation  with  Mr.  Sharon  upon  the  subject,  but  I 
never  asked  him  a  question  in  reference  to  his  views.  These  were  rather 
casual  expressions." 

THE  DEBATE  ITS  CONGEESS,  MAECH  23,  1870. 

"Mr.  BIGGS.  Mr.  Speaker,  as  a  member  of  the  Committee  on  Mines  and 
Mining,  I  have  given  the  bill  which  is  now  before  the  House  some  reflection, 
and  I  have  come  to  the  conclusion,  with  eight  of  my  colleagues  on  that  com- 
mittee, that  the  bill  ought  not  to  pass.  Only  one  member  of  the  committee 
(Mr.  Sargent)  can  be  found  to  advocate  its  passage.  It  is  true  that  the  judg- 
ment of  the  eight  members  of  the  committee  may  perhaps  be  at  fault ;  but  I 
think  if  the  House  will  carefully  investigate  the  subject,  they  will  come  to  the 
conclusion  that  the  bill  is  an  outrage  upon  the  rights  of  Mr.  Sutro  and  his 
company. 

"Now  we  see,  sir,  the  very  superintendents  of  the  mining  companies,  who 
had  subscribed,  together  with  private  individuals,  the  aggregate  sum  of  $600,- 
000  toward  the  construction  of  this  tunnel,  telegraph  to  the  Senators  from 
Nevada  that  they  are  opposed  to  the  Sutro  tunnel ;  that  they  want  it  defeat-  . 
ed ;  and  that  they  repudiate  their  subscriptions.  How,  then,  could  Mr.  Su- 
tro go  on  with  his  tunnel?  He  was  not  a  man  possessed  of  great  fortune.  He 
had  raised  the  amount  of  $600,000,  and  these  very  identical  men,  who  had 
subscribed  for  the  purpose  of  constructing  the  tunnel,  turned  round  and  tele- 
graphed to  Senators  STEWART  and  NYE — the  former  of  whom  was  actually,  in 
1865,  the  president  of  the  Sutro  Tunnel  Company — that  they  did  not  want 
the  tunnel,  and  wished  it  defeated." 

4.  "And  now  the  corporation  comes  again  and  asks  Congress  for 
three  million  dollars,  with  which  to  construct  its  tunnel, 
and  the  committee  propose  to  appropriate  two  millions." 

The  work  is  being  pushed  ahead  by  day  and  by  night, 
at  an  expense  of  $3,000  for  every  twenty -four  hours;  and 
the  committee  recommend  a  loan  of  $2,000,000,  with  the 
strongest  restrictions,  and  with  the  most  ample  security. 
The  work  in  its  results  being  of  national  importance,  and 
in  its  magnitude  beyond  the  capacity  of  private  enterprise. 
The  proposed  loan  is  but  a  small  proportion  of  the  total 


cost  of  the  work,  and  is  asked  for  mainly  to  secure  a  sub- 
stantial recognition  of  its  national  importance, 

5.  "Neither  the  Government  nor  the  people  have  any  interest  in 

this  scheme.  They  will  not  be  benefited  by  it  in  the 
least,  if  it  should  prove  financially  successful." 

Both  the  Government  and  the  people  have  the  deepest 
interest  in  the  execution  of  this  work.  It  will  practically 
demonstrate  the  continuance  of  mineral  lodes  to  greater 
depths  than  have  ever  before  been  reached  in  the  world,  thus 
contributing  largely  to  science,  and  at  the  same  time  in- 
creasing the  value  of  our  mineral  domain  to  the  extent  of 
thousands  of  millions  of  dollars. 

6.  "  While   the   Government  is  asked  to  furnish  the  money  to 

construct  the  tunnel  and  assume  the  risk  of  its  failure,  all 
the  benefit  will  accrue  to  the  corporation." 

The  Government  assumes  but  a  very  small  proportion 
of  the  risk,  if  there  be  any.  One  million  dollars  has  been 
expended  on  the  work  during  the  year  1872  alone,  and 
under  the  bill  an  equal  amount  must  be  expended  hereafter, 
before  any  advances  whatever  are  to  be  made.  If  the  suc- 
cess of  the  work  places  millions  in  the  coffers  of  the  nation, 
the  fact  that  the  individuals  undertaking  it  will  derive  bene- 
fit therefrom  does  not  weaken  the  argument  in  its  favor. 

7.  "It  is  not  denied  that  the  construction  of  this  tunnel  will 

render  valueless — in  fact,  destroy- — over  twelve  million 
dollars  of  private  property.  The  property  of  every  in- 
habitant of  Virginia  City  and  Gold  Hill  will  we  rendered 
valueless,  if  this  tunnel  proves  a  success." 

The  construction  of  the  tunnel  will  not  destroy  any 
property  at  all.  If  it  should  depreciate  the  value  of  some 
town  lots  at  Virginia  City,  it  will  be  on  the  same  principle 
that  stage  coaches  depreciate  in  value  after  the  introduction 
of  railroads.  The  depreciation  which  will  take  place  in  the 
value  of  some  property  has  been  assumed  to  be  about  one 
million  of  dollars,  while  the  value  of  the  mines  on  the  Corn- 
stock  lode  alone  will  be  increased  to  the  value  of  one  hun- 
dred million  dollars.  The  inhabitants  of  Virginia  City  and 
Gold  Hill  should  be  the  best  judges  of  their  interests.  At 


8 

the  late  election  the  issue  was  directly  made  upon  the  tunnel 
question,  and  the  Hon.  Chs.  W.  Kendall,  in  advocating  the 
measure,  was  800  votes  ahead  of  his  ticket  in  that  locality. 

8.  "  The  tunnel  is  a  mere  private  speculation,  and  has  no  claim 
whatever  upon  the  Government  for  aid." 

Construction  of  the  tunnel  was  authorized  hy  the  Legis- 
lature of  Nevada  and  the  Congress  of  the  United  States. 
The  President  appointed  a  commission  to  examine  the 
same,  and  calls  special  attention  thereto  in  his  late  mes- 
sage. The  great  national  importance  of  the  work  has  been 
recognized  by  the  Legislature  of  Nevada,  and  by  every 
committee  which  has  examined  the  subject  in  the  39th, 
40th,  41st,  and  42d  Congresses. 

For  reference  see : 

1st.  The  act  of  the  Nevada  Legislature,  entitled  "  An 
act  granting  the  right  of  way  and  authorizing  A.  Sutro  and 
his  associates  to  construct  a  mining  and  draining  tunnel," 
approved  February  4,  1865.  (See  Book  on  Sutro  Tunnel, 

p.  n.) 

2d.  The  contracts  with  the  mining  companies.  (See 
Book  on  Sutro  Tunnel,  p.  173.) 

3d.  Law  of  Congress,  entitled  "An  act  granting  the 
right  of  way  and  granting  other  privileges  to  aid  in  the 
construction  of  a  draining  and  exploring  tunnel  to  the  Corn- 
stock  lode,  in  the  State  of  Nevada,"  approved  July  25, 

1866.  (See  U.  S.  Statutes  at  Large,  vol.  14,  p.  242.) 
4th.  The  Comstock  Lode,  its  Character,  &c.     By  Ferdi- 
nand Baron  Richthofen,  Dr.  Phil,  San  Francisco:  Towne 
&  Bacon,  printers,  1866.     (See  Book  on  Sutro  Tunnel,  p. 
95.) 

5th.  Joint  memorial  and  resolutions  by  the  Nevada  Leg- 
islature, asking  Government  aid  in  the  construction  of  the 
Sutro  tunnel,  1867.  (See  Book  on  Sutro  Tunnel,  p.  13.) 

6th.  Report  of  the  Legislature  by  the  Senate  Committee 
on  Federal  Relations  on  the  foregoing  memorial,  1867.  (See 
Book  on  Sutro  Tunnel,  p.  77.) 

7th.  Resolutions  by  the  Nevada  Legislature,  January, 

1867.  (See  Book  on  Sutro  Tunnel,  p.  92.) 


9 

8th.  Report  to  the  Mechanics'  Institute  of  San  Francisco 
by  a  special  committee  appointed  to  investigate  the  merits 
of  the  Sutro  tunnel,  April  4,  1867.  (See  Book  on  Sutro 
Tunnel,  p.  141.) 

9th.  Report  on  the  Sutro  tunnel  by  Hon.  Joseph  S.  Wil- 
son, Commissioner  of  the  General  Land  Office,  Washing- 
ton, June,  1868.  (See  Miscellaneous  Documents,  No.  156, 
40th  Congress,  2d  session.) 

10th.  Report  of  the  Committee  on  Mines  and  Mining  to 
the  United  States  House  of  Representatives,  recommending 
an  appropriation  of  $5, 000,000  by  the  Government.  (Pub. 
Doc. ;  see  Report  No.  50,  40th  Congress,  2d  session.) 

llth.  Proceedings  in  the  House  of  Representatives  of 
the  United  States,  March  17,  22,  and  23,  1870,  and  in  the 
United  States  Senate,  April  27  and  28,  1870. 

12th.  "  An  act  authorizing  and  requesting  the  President 
of  the  United  States  to  appoint  a  commission  to  examine 
and  report  upon  the  Sutro  tunnel,"  approved  April  4,  1871. 

13th.  Report  of  the  commissioners  on  the  Sutro  tunnel. 
(See  Ex.  Doc.  No.  15,  42d  Congress,  2d  session.) 

14th.  Evidence  taken  by  the  Committee  on  Mines  and 
Mining,  42d  Congress,  2d  session. 

15th.  Reports  of  the  United  States  Commissioners  on 
Mines  and  Mining  for  the  years  1866,  1867,  1868,  1869, 
1870,  and  1871. 

9.  "It  is  simply  a  huge  job,  got  up  by  speculators,  to  tax  the 
miners  on  the  Comstock  lode,  without  conferring  any 
adequate  or  substantial  benefits  in  return." 

The  Sutro  Tunnel  Company  was  organized  under  vol- 
untary contracts  with  the  mining  companies,  establishing 
rates  fair,  just,  and  equitable.  No  payments  are  to  be 
made  until  after  the  completion  of  the  tunnel,  when  the 
benefit  to  the  miners  will  be  many  fold  the  rates  which 
have  to  be  paid. 

(See  Debates  in  H.  of  Rep.,  March  23,  1870.) 

"  Mr.  KERR.  I  think  that  in  the  original  proposition  there  was  nothing 
wrong,  nothing  unjust,  nothing  oppressive,  nothing  that  in  any  of  its  char- 
acters and  incidents  is  extraordinary,  as  is  intimated  by  the  honorable  gen- 
tlemen on  the  other  side.  In  addition  to  what  I  have  said,  I  desire  to  call 


10 

attention  to  a  further  fact,  that  under  the  law,  which  it  is  now  desired  to 
repeal,  and  under  the  contract  which  that  law  adopts,  not  one  of  these  min- 
ing companies  or  individual  miners  is  required  to  pay  one  farthing  to  this 
tunnel  company  in  the  way  of  royalty  or  anything  else,  until  the  tunnel  shall 
have  been  constructed  and  they  shall  have  begun  to  derive  advantage  from 
it.  In  other  words,  the  entire  obligation  is  strictly  reciprocal ;  its  burdens 
and  its  benefits  go  together;  they  run  constantly  and  perpetually  in  parallel 
lines.  And  the  whole  assumption,  therefore,  that  there  is  oppression  or  injus- 
tice or  monopoly  in  this  matter,  strikes  me  as  being  very  far-fetched  and  purely 
unfounded." 

10.  "Part  of  the  scheme,  directly  provided  for  in  the  bill  by  an 
appropriation  of  half  a  million  of  the  people's  money,  is 
to  secure  a  monopoly  of  quartz-crushing  and  smelting  to 
the  corporation." 

The  waste  in  the  reduction  of  gold  and  silver  ores,  as 
at  present  practiced,  is  a  disgrace  to  our  intelligent  age. 
35  per  cent.,  or  eight  millions  of  dollars,  are  annually  lost 
to  the  mining  companies  in  the  reduction  of  the  ores  of  the 
Comstock  lode ;  while  it  has  been  shown  that  concentrating 
and  reducing  works  at  the  mouth  of  the  tunnel  will  save 
TO  per  cent.,  or  $5,750,000  per  annum  of  what  is  now  wasted. 
At  the  same  time  it  will  serve  as  a  pattern-work  for  making 
available  the  thousands  of  millions  of  dollars  contained  in 
low-grade  ores  throughout  our  mineral  domain,  and  which 
are  now  of  no  practical  value.  The  Bank  of  California 
and  the  milling  and  mining  rings  oppose  the  construction 
of  the  tunnel,  and  the  consequent  erection  of  mills  at  the 
mouth  of  the  same,  since  these  will  be  able  to  work  much 
cheaper  than  can  be  done  under  the  present  system,  which 
will  consequently  break  up  their  existing  monopolies. 

(See  Evidence,  page  135,  testimony  of  Prof.  Wesley  New- 
comb.) 

"  Q.  (By  Mr.  SUTRO.)  If  mills  were  erected  at  the  mouth  of  that  tunnel, 
Professor,  with  the  present  mode  of  reducing  the  ore — that  is,  to  crush  the 
ores  and  amalgamate  them  and  save  the  tailings — do  you  think  that,  in  run- 
ning those  tailings  over  concentrating-tables  and  concentrating-works,  a 
greater  saving  could  be  made?" 

"A.  I  think  it  is  a  disgrace  to  any  country  that  we  lose  35  per  cent,  of  the 
metals." 

(See  Commissioners'  Keport,  page  22.) 

"  The  loss  of  precious  metals  in  the  reduction  by  the  German  and  English 


11 

methods  is  represented  to  be  not  exceeding  5  per  cent.,  while  in  Nevada  it  is 
not  far  from  35  per  cent,  in  milling,  with  a  saving  of  perhaps  10  per  cent, 
more  in  the  subsequent  workings  of  the  tailings  and  slimes,  making  less  than 
75  per  cent  in  all.  The  actual  loss  in  reduction,  therefore,  appears  to  be 
more  than  25  per  cent.,  which,  for  a  production  of  $15,000,000  per  annum, 
entails  a  loss  of  the  precious  metals  exceeding  $5,000,000,  or  a  loss  beyond 
what  would  result  from  the  methods  referred  to,  by  which  95  per  cent,  is 
saved,  or  at  least  $4,000,000  annually." 

II.  "  The  miners  do  not  want  this  tunnel.  They  protest  against 
it.  They  insist  upon  their  right  to  manage  their  own 
property  in  their  own  way,  without  any  interference  on 
the  part  of  this  corporation  or  the  Government." 

It  is  not  the  miners,  but  the  Bank  of  California,  and 
the  milling  rings  and  monopolies,  who  protest  against  the 
tunnel.  The  laboring  miners,  the  miners'  unions,  and  all 
the  laboring  classes  petition  for  it.  They  want  it  built  as  a 
great  exploring  work,  giving  an  unknown  impetus  to  min- 
ing, employing  tens  of  thousands  of  people,  and  securing 
their  health.  Overgrown  monopolies  and  unscrupulous 
speculators  oppose  the  work,  while  the  bone  and  sinew,  the 
honest  laboring  miners,  support  it  with  all  their  might. 

(See  Evidence,  page  83,  testimony  of  Major  General  J.  G. 
Foster.) 

"Q.  (By  General  NEGLEY.)  My  inquiry  arose  from  the  fact  that  miners  in 
our  coal  mines  are  almost  invariably  opposed  to  any  innovation  or  new  cus- 
tom in  the  old-established  rules  of  mining. 

"  A.  Now  that  you  have  mentioned  that,  I  will  say  the  miners,  as  far  as  I 
could  get  information  from  prominent  men,  seemed  to  be  in  favor  of  the  tun- 
nel.    I  believe  the  miners'  union  is  in  favor  of  the  tunnel. 
'    "Q.  Did  they  give  you  their  reason? 

"A.  No;  they  had  no  reason  that  I  knew  of.  They  had  their  preferences 
though. 

"Mr.  SUTRO.  General,  do  you  know  who  are  opposed  to  the  tunnel,  or  at 
least  who  are  charged  with  being  opposed  to  it  over  there  by  these  people 
you  speak  of?  Who  is  at  the  bottom  of  it? 

"Mr.  FOSTER.  If  you  want  a  straight- forward  answer,  I  would  say  that  the 
property  owners  in  Virginia  City,  those  who  have  money  invested  in  the 
mills  around  there,  the  Bank  of  California,  through  its  agent,  and  the  rail- 
road company. 

"Q.  May  I  ask  you  who  the  owners  of  the  railroad  are,  as  far  as  you 
know;  whether  it  is  owned  by  the  Bank  of  California  or  its  men? 

"A.  I  don't  know  who  the  owners  are. 

"Q.  Well,  what  did  you  hear  over  there?  Tell  us  simply  by  hearsay.  You 
cannot  have  an  absolute  knowledge? 


12 

"A.  I  haven't  the  slighest  idea  who  owns  that  road. 

"Q.  Who  has  control  of  it? 

"A.  Mr.  Sharon  seemed  to  control  it. 

"  Q.  The  agent  of  the  Bank  of  California? 

"A.  Yes,  sir. 

"Q.  Who  owns  the  majority  of  the  mills  over  there? 

"A.  On  the  Carson  river? 

"Q.  Yes,  sir;  and  the  other  mills — the  majority  of  the  mills? 

"A.  A  very  large  number  of  the  mills  are  owned  by  the  Union  Mill  and 
Mining  Company. 

11  Q.  Do  you  know  whether  the  Bank  of  California  has  anything  to  do  with 
that? 

"A.  Mr.  Sharon  has  a  large  amount  of  stock  in  that,  I  believe,  but  I  am 
not  positive. 

"Q.  Is  he  the  agent  of  the  Bank  of  California? 

"A.  I  heard  so. 

"Well,  then,  the  opposition  to  it  is  by  the  Bank  of  California,  by  the  rail- 
road, and  by  the  mills,  which  means  the  Bank  of  California  and  by  some 
people  who  own  town  lots  in  Virginia  City." 

(See  evidence,  page  266  testimony  of  T.  L.  Kequa.) 

"  Q.  (By  Mr.  SUTRO.)  Do  you  know  who  compose  the  Union  Mill  and 
Mining  Company  ? 

"  A.  I  do  not  exactly  know.  I  know  who  did — a  portion  of  the  parties  who 
did  compose  it. 

"  Q.  Do  you  not  know  who  compose  it  now,  principally  ? 

"  A.  No,  I  cannot  say  that  I  do. 

"  Q.  Do  you  know  that  Mr.  Sharon  is  a  large  owner? 

"  A.  Yes,  sir. 

"  Q.  Mr.  Ralston  ? 

"A.  Yes,  sir;  he  is  reputed  to  be. 

"  Q.  Is  not  Mr.  Mills  president,  of  the  Bank  of  California? 

"  A.  Yes,  sir. 

"  Q.  Are  not  they  the  owners  of  the  whole  property  ? 

"  A.  I  think  there  is  no  interest  outside  of  that. 

"  Q.  They  are  about  the  principal  owners  then  ? 

"  A.  So  I  understood. 

"  Q.  Then  the  main  owners  are  the  president  of  the  Bank  of  California,  the 
cashier  of  the  Bank  of  California,  and  Mr.  Sharon,  their  agent  at  Virginia 
City? 

"A.  Yes,  sir;  that  is  my  understanding." 

(See  Evidence,  page  138  testimony  of  Prof.  Wesley  New- 
comb.) 

"  Q.  (By  Mr.  SUTEO.)  How  do  they  show  the  opposition  to  the  tunnel, 
Prof.  ?  Do  they  exercise  any  influence  over  the  people  at  Virginia  City,  in 
such  a  manner  as  to  prevent  them  from  becoming  interested  in  the  tunnel 
and  seeing  it  go  ahead  ? 


13 

"A.  Well,  we  took  the  evidence  of  some  of  the  miners  in  regard  to  that;  one 
of  them  particularly  specified  that  he  did  not  wish  to  have  his  name  given  in 
connection  with  it  in  any  way;  and,  in  the  course  of  conversation,  he  stated 
that  if  the  mining  ring  knew  that  any  intelligence  was  communicated  to  the 
commissioners,  adverse  to  what  was  thought  to  be  in  their  own  interests,  and 
in  favor  of  the  tunnel,  the  parties  communicating  it  would  be  discharged  from 
employment,  and  he  would  not  like  to  have  his  name  mentioned  in  connec- 
tion with  it.  He  gave  us  some  little  information  upon  the  subject,  still 
further  in  regard  to  the  amount  of  low-grade  ores." 

(See  Speech  by  the  Hon.  Wm.  D.  Kelley  in  the  House  of 
Representatives,  March  23,  1870.) 

"Gentlemen  on  the  other  side  have  spoken  for  the  owners  of  mines.  I  pro- 
pose to  speak  for  the  miners,  the  men  who  with  pick  and  shovel  extract  the 
ore,  and  forty-five  per  cent,  of  whom  die  of  miners'  consumption,  which  seizes 
them  and  penetrates  their  vitals  before  they  are  admonished  of  its  approach, 
and  who  die  in  their  youth,  or  in  the  vigor  of  their  young  manhood,  pros- 
trated by  the  heat  and  poisoned  by  the  atmosphere  of  these  mines.  These 
industrious  men  are  subscribing  to  stock  in  the  Sutro  Tunnel  Company ;  they 
swarm  behind  Mr.  Sutro,  and  beg  Congress  to  vest  all  the  rights  in  him  that 
will  enable  him  to  redeem  them  from  the  terrible  doom  to  which  the  so-called 
miners'  friends  would  still  condemn  them." 

******** 

"Sir,  I  brought  with  me  from  one  of  these  mines  a  bit  of  blackened  ore, 
blackened  by  the  smoke  of  a  fire  that  smothered  and  burned  forty- five  of 
these  men  in  the  mine.  Had  there  been  a  tunnel  such  as  Mr.  Sutro  is  con- 
structing, they  would  have  been  breathing  pure  air  while  at  work ;  and  though 
the  lumber  of  the  mine  might  have  burned,  the  miners  could  have  dropped 
below  the  fire  and  escaped." 

1 2.  "  The  miners  have  bought  their  lands  from  the  Government 
and  paid  for  them.  The  Government  has  no  more  right 
to  dictate  to  them  how  they  shall  work  their  mines  than 
it  has  to  dictate  to  the  farmers  how  they  shall  cultivate  the 
farms  which  they  have  bought  from  the  Government  and 
paid  for." 

The  mining  companies,  to  a  large  extent  controlled  by 
the  Bank  of  California,  simply  bought  a  squatter's  right  to 
the  mines.  They  held  them  at  suffrance  from  the  Govern- 
ment, and  the  title  was  only  conveyed  under  the  condition 
expressed  in  the  patents,  that  the  rates  named  in  the  con- 
tracts should  be  paid,  in  order  to  secure  the  execution  of  a 
work  deemed  necessary,  essential,  and  important  by  all  par- 
ties concerned. 

(See  Debate  in  House  of  Representatives,  March  23, 1870.) 
"  Mr.  KERB.  It  is  said  that  the  old  law  organized  a  monopoly'  in  Nevada. 


14 

I  do  not  understand  that  it  does  any  such  thing  or  brings  about  any  such 
result.  This  tunnel  idea  stands  upon  a  very  common  one  in  application  to 
various  other  subjects  throughout  the  country,  and  it  is  only  by  the  name 
that  is  given  to  it  in  Nevada  that  the  people  are  misled  and  do  not  under- 
stand just  what  it  means.  The  country  is  everywhere  familiar  with  various 
systems  of  ordinary  sewerage  and  drainage  in  cities,  towns,  and  the  country. 
The  obvious  principles  of  law,  of  just  and  fair  contributions  for  common  ad- 
vantages and  benefits,  on  which  they  are  maintained,  are  well  understood. 
There  is  no  character  of  monopoly  or  uncommon  hardship  about  them. 

"Now,  Mr.  Speaker,  the  whole  of  this  law  consists  in  this  simple  proposi- 
tion, that  here  is  to  be  constructed  a  sewer,  if  you  please  a  drain,  that  will 
inevitably  benefit  every  owner  whose  property  is  in  any  way  reached  and 
drained  and  ventilated  by  it.  In  this  city  of  Washington  and  in  all  the 
cities  of  this  country  it  is  a  common  practice  to  require  the  persons  who  de- 
rive advantage  from  the  construction  of  such  works  to  contribute  to  their 
construction  originally  and  to  their  maintenance  thereafter. 

"But  it  is  very  clear,  Mr.  Speaker,  that  while  gentlemen  say  here  that 
these  people  had  a  possessory  right  in  this  soil  before  this  last  law  was  passed, 
they  utterly  destroy  the  value  that  is  in  that  position  when  they  also  say 
that  the  mines  involved  in  this  legislation  have  very  great  value,  and  that 
out  of  these  mines  these  same  miners  have  already  extracted  $100,000,000  in 
precious  metals.  Now,  if  that  be  so,  it  seems  to  me  that  for  that  shadowy, 
that  unreal,  that  executory — it  is  not  that  much  in  law — that  mere  possessory 
claim  of  right,  they  have  been  most  munificently  paid,  and  ought  not  to  come 
back  here  and  ask  for  more.  But  a  further  answer  to  their  position  is  found 
in  the  fact,  that  when  the  original  application  to  Congress  was  made,  these 
miners  themselves  went  to  work  and  executed  these  voluntary  individual 
contracts  with  this  tunnel  company,  by  which  they  agreed,  whenever  the 
tunnel  was  constructed,  to  contribute  these  several  sums  to  aid  its  construc- 
tion and  maintenance. 

"Mr.  FERRIS.  The  gentleman  from  Nevada  (Mr.  Fitch)  talked  about  the 
right  which  the  owners  of  these  mines  have  acquired  Up  to  the  passage  of 
the  Sutro  tunnel  act,  as  it  is  called,  the  third  section  of  which  gives  a  royalty 
to  the  constructors  of  the  tunnel  in  case  they  drain  the  mines — up  to  that 
time  there  was  no  law  upon  the  statute  book  which  gave  any  man  in  this 
country  a  right  to  one  single  foot  of  mining  land,  with  the  exception  of  a 
sm.all  quantity  of  lands  in  California,  the  right  to  which  was  acquired  under 
the  Mexican  title,  so-called.  In  all  other  cases  every  occupier  of  every  foot 
of  the  mineral  lands  was  merely  a  squatter.  All  the  title  he  had  was  a  mere 
license — a  mere  privilege  granted  by  the  Government. 

"Mr.  WOODWARD.  Well,  sir,  yesterday  we  had  an  extraordinary  spectacle 
on  this  floor,  when  the  only  representative  of  the  State  of  Nevada  denounced 
that  legislation  in  the  most  violent  manner  as  improper  and  dishonest.  The 
act  of  1866  looked  to  the  commencement  of  the  greatest  work  of  internal  im- 
provement that  has  ever  been  contemplated  in  the  State  of  Nevada.  It  was 
legislation  which  was  calculated  to  develop  her  mineral  resources  to  a  greater 
extent  than  anything  else  that  has  been  proposed.  This  legislation  was  yes- 
terday denounced  on  this  floor  by  the  Representative  of  the  State  of  Nevada 


as  dishonest  and  corrupt.  Now,  Mr.  Speaker,  I  say  that  my  eloquent  friend 
from  Nevada,  in  opposing  this  bill,  manifestly  does  not  represent  the  State  of 
Nevada.  He  says  that  he  does  not  represent  the  'bank  ring.'  I  do  not  know 
that  anybody  charges  him  with  doing  so.  But  he  does  not  represent  the  State 
of  Nevada,  or  else  the  documents  which  we  had  before  our  committee  for  a 
whole  year  were  forgeries." 

13.  "Two  years  ago  a  commission  was  appointed,  consisting  of 
one  civil  and  two  military  engineers,  to  visit  the  Corn- 
stock  lode  and  examine  and  report  upon  the  tunnel  pro- 
ject of  the  Sutro  corporation.  *That  commission  per- 
formed its  duty,  and  its  report  is  before  us.  The  report 
is  very  carefully  written,  and  is  adverse  to  this  scheme 
on  every  point  which  the  commissioners  investigated." 

The  report  is  favorable,  except  upon  such  points  as 
were  hased  upon  statements  furnished  by  the  agents  of  the 
Bank  of  California.  The  testimony  afterwards  taken  has 
conclusively  proven  that  these  were  made  by  interested  par- 
ties, and  that  many  of  them  are  false. 

14.  "That  commission  reports  that  the  tunnel  'is  not  a  necessity 
for  ventilation  or  drainage.' " 

The  testimony  of  the  commissioners,  together  with  that 
of  other  experts,  proves  the  tunnel  to  be  of  the  highest  im- 
portance, both  for  ventilation  and  drainage.  Newspapers 
have  for  years  been  employed  to  state  that  there  is  no  water 
in  the  mines,  while  the  evidence  shows  this  to  be  the  great- 
est obstacle  in  prosecuting  mining  operations  on  the  Corn- 
stock  lode. 

(See  Evidence,  page  211,  testimony  of  General  W.  T. 
Wright.) 

"  Q.  (By  Mr.  SUTKO.)  Did  you  calculate,  General  Wright,  how  much  the 
water  amounted  to  in  tons  in  the  Ophir  mine,  taking  the  average  of  the  year 
commencing  with  June,  1870,  and  ending  the  1st  of  June,  1871? 

"A.  The  average  was  lOf  inches. 

"Q.  How  much  would  that  be  in  tons  for  twenty-four  hours  ? 

"A.  Seven  hundred  and  eighty-one  tons  and  five  one-thousandths  (781T75irg-.) 

"  Q.  Did  you  make  any  figures  on  the  maximum  quantity,  as  stated  by  Cap- 
tain Day,  for  that  year,  which  is  18  inches? 

"A.  Eighteen  inches  gives  the  weight  for  twenty-four  hours  at  1,318  tons. 
******** 

11  Q.  Wouldn't  you  think  it  quite  likely?  [that  in  tapping  the  vein  the 
water  would  come  back  to  this  standard.] 


16 

"A.  I  should  think  certainly  that  they  would  find  more  water  as  they  go 
into  the  vein." 

(For  further  particulars  in  regard  to  drainage  and  venti- 
lation see  Book  of  Evidence,  pages  364  to  374;  also  Mr. 
Sutro's  argument,  pages  416,  417,  418,  419,  and  420.) 

15.  "It  also  reports  that  the  present  cost  of  mining  and  transport- 

ation of  ore  is  $700,000  per  annum  less  than  after  the 
completion  of  the  tunnel  and  its  use  for  transportation." 

The  testimony  shows  that  the  comparative  cost  between 
the  present  mode  of  mining  and  that  through  the  tunnel 
will  make  an  annual  saving  of  $9,391,751  in  favor  of  the 
latter. 

(See  Recapitulation  in  Mr.  Sutro's  argument,  Book  of  Evi- 
dence, page  425.) 

16.  "It  shows  that  the  miners  are  taxed  the  enormous  rate  of  $2 

per  ton  on  all  their  ore  after  the  tunnel  is  built,  for  the 
use  of  the  corporation,  whether  they  use  the  tunnel  or 
not,  thus  compelling  them  to  adopt  the  more  expensive 
method." 

The  tax  of  $2  per  ton  has  been  shown  to  be  a  mere 
trifle  compared  with  the  benefits  the  tunnel  will  furnish. 
The  Union  Mill  and  Mining  Company,  "owned  by  the 
Bank  of  California/'  the  principal  opponents  of  the  tunnel, 
now  exact  a  clear  profit  on  every  ton  of  ore  worked  of  $5  50, 
which  will  be  saved  after  the  completion  of  the  tunnel.  No 
tax  whatever  is  imposed,  except  in  case  ore  is  taken  out,  and 
the  full  benefits  of  the  tunnel  are  realized. 

(See  Evidence,  page  268  testimony,  of  I.  L.  Requa,  super- 
intendent of  the  Chollar  Potosi  mine,  sent  to  Washington 
to  testify  against  the  tunnel.) 

"  Q-  (by  Mr.  SUTEO.)  Then  we  get  83,775  tons  on  which  your  company 
paid  for  milling.  You  say  it  cost  $4  50  to  mill  ? 

"A.  on  the  river,  I  think  so,  at  the  present  rate  of  working.  According 
to  the  present  modes,  under  the  reorganization  of  some  of  the  mills,  they  have 
increased  their  capacity  very  materially,  and  they  can  work  ores  cheaper 
than  they  could  twelve  months  ago. 

"  Q.  Will  you  be  kind  enough  to  figure  how  much  it  would  come  to,  mill- 
ing 83,775  tons,  at  $4  50  per  ton  ? 


17 

41  A.  I  think  the  exact  figuring  about  $376,000— $377,000  nearly. . 

"  Q.  Taking  the  price  paid  at  $10  a  ton.  how  much  difference  does  that 
make? 

"  A.  That  would  be  $837,750 ;  $377,000  deducted  from  that  leaves  $460,000. 

"  Q.  Then  the  Chollar  Potosi  Company  paid  a  profit  to  the  Union  Milling 
Company  of  $460,000  in  one  year  ? 

"  A.  No,  I  think  not.  They  did  not  work  it  all  by  water-power.  There 
was  steam-power  used  on  a  good  deal  of  the  ore.  We  had  worked  out  83,775 
tons. 

17.  "The  Government  is  asked  to  appropriate  money  to  fasten 

the  yoke  of  this  corporation  on  the  miners'  necks  for  all 
time,  and  compel  the  miners  to  adopt  a  more  expensive 
method  of  working  the  mines  than  their  own  industry 
and  intelligence  have  created,  for  the  benefit  of  this  cor- 
poration." 

It  has  already  been  shown  that  it  is  not  the  miners,  but 
the  Bank  of  California,  who  still  cling  to  the  hope  that 
they  can  prevent  the  completion  of  the  tunnel.  If  the 
pending  bill  is  passed  its  speedy  construction  will  be  insured, 
and  hence  the  violent  opposition  to  its  passage  by  the  Bank 
of  California. 

1 8.  "Sutro  and  his  company  find  the  miners  on  the  Comstock 

lode  taking  out  ore  valued  at  millions  annually.  Neither 
he  nor  his  company  have  any  interest  in  these  mines; 
but  they  devise  a  plan  by  which  they  seek  to  levy  tribute 
forever  upon  them. 

Parties  connected  with  the  Sutro  Tunnel  Company  are 
largely  interested  in  the  mines,  and  are  opposed  to  the 
swindling  practices  perpetrated  under  the  auspices  of  the 
Bank  of  California  and  its  confederates. 

(See  evidence,  page  186,  testimony  of  Professor  Wesley 
Newcomb.) 

"  Professor  NEWCOMB.  *  *  *  One  of  the  superintendents  told  me  that  they 
were  in  the  habit  of  taking  the  low-grade  ores,  which  would  not  pay  the  ex- 
pense of  milling,  and  mixing  them  with  good  ores,  to  furnish  the  reduction 
works  with  material,  thus  cheating  the  mines  absolutely  out  of  the  cost  of 
that  reduction. 

"Q.  Who  was  the  superintendent? 

"A.  I  didn't  name  him. 

"Q.  You  decline  to  give  his  name? 

"A.  The  statement  was  made  in  the  presence  of  the  superintendent  of  the 

2 


18 

Crown  Point.     I  don't  wish  to  involve  the  character  of  any  individual;  but 
to  me  it  looked  as  though  he  was  derelict  in  his  duty. 

(See  page  187  of  the  same.) 

"Q.  Is  it  not  common  report,  and  known  to  everybody,  that  these  mines 
are  managed  and  worked  not  so  much  for  the  benefit  of  the  stockholders,  as 
for  the  benefit  of  those  rings  who  control  them? 

"A.  Well,  it  has  been  so  represented,  I  will  not  give  it  as  a  matter  of 
absolute  knowledge  that  I  have  myself,  but  it  has  been  generally  understood 
so;  and  I  have  had  my  views  in  regard  to  it  for  many  years,  that  that  was 
the  understanding. 

"Q.  Isn't  it  a  notorious  fact,  known  to  everybody,  that  these  mines  are 
simply  worked  for  stockjobbing,  and  in  order  to  bull  and  bear  the  market? 

"A.  No,  I  think  it  is  for  the  bullion  as  well. 

"Q.  Isn't  the  extraction  of  the  bullion  simply  a  secondary  consideration? 

"A.  I  should  consider  it  so  with  very  many  that  are  following  the  business 
for  a  livelihood.  There  are  many  men  that  follow,  as  a  business,  these  stock- 
jobbing operations.  It  makes  it  a  species  of  gambling.  They  really  care 
nothing  about  the  results,  if  they  can  buy  the  stock  at  a  low  price  and  get 
it  up. 

(See  page  249,  testimony  of  General  H.  G.  Wright.) 

"  Q.  Have  you  heard  of  ore  being  hidden  in  a  mine  by  the  managers  after 
it  has  been  discovered  ? 

"A.  I  cannot  say ;  but  I  have  heard  that  it  has  been  attempted  to  keep 
such  a  thing  a  secret.  I  really  don't  know  whether  it  has  been  successful. 
I  have  no  information  upon  which  to  substantiate  it. 

"Q,.  As  far  as  you  know,  is  not  the  general  opinion  over  there  that  these 
mines  are  managed  for  stock-jobbing  purposes,  in  the  interest  of  rings? 

"A.  I  think  they  are  managed  for  stock-jobbing  purposes.  I  do  not  think 
they  are  managed  entirely,  perhaps,  in  the  interests  of  a  ring.  I  would  like 
to  say  further,  that  the  impression  I  got  there  was,  that  persons  did  not  pur- 
chase stock  in  the  mines  for  the  purposes  of  investment  at  all,  but  for  pur- 
poses of  speculation,  and  it  matters  very  little  to  them  whether  the  ore  was 
found  or  reported  to  be  found." 

19.  "The  miners  were  not  represented  here,  and  Sutro  succeeded 
in  passing  the  law  of  1866,  which  ought  not  to  have  been 
passed,  and  would  not  have  been  if  the  miners  had  been 
heard,  or  the  construction  since  given  to  it  have  been 
obvious." 

The  miners  were  fully  represented  in  both  Houses  of 
Congress  when  the  law  of  1866  was  passed.  The  measure 
had  the  unanimous  support  of  the  whole  Pacific-coast  dele- 
gation, and  they  urged  its  passage. 

(See  Debate  in  Congress,  March  23, 1870.) 

"  Mr.  KEKR.  Mr.  Speaker,  after  a  careful  examination  of  this  question,  I 


19 

have  reached  the  conclusion  that  it  is  the  duty  of  the  House  to  leave  the  leg- 
islation on  this  subject  as  it  now  stands,  and  to  deny  the  prayer  of  the  minority 
of  the  committee.  I  am  led  to  that  conclusion,  in  the  first  place,  by  the  reflec- 
tion that  this  whole  subject  was  referred  very  properly  by  this  House  to  one 
of  its  most  intelligent  committees,  consisting  of  nine  gentlemen,  eight  of  whom 
report  to  this  House  that  this  proposed  legislation  is  not  to  be  enacted;  and 
the  minority,  consisting  of  only  one  member,  (Mr.  Sargent)  asks  its  passage. 
In  addition  to  that,  my  own  judgment  is,  that  upon  its  merits  this  bill  ought 
not  to  be  passed." 

"This  tunnel  company  was  organized  at  the  request  of  these  miners;  at  the 
request  of  the  Senators  and  Representatives  from  the  State  of  Nevada;  at  the 
request  of  the  Legislature  of  Nevada ;  at  the  request  of  the  Governor  of  Ne- 
vada ;  and  of  all  the  people  of  Nevada,  in  all  the  forms  in  which  they  could 
make  their  wishes  known  to  Congress.  I  believe  that  this  identical  law  that 
it  is  sought  now  to  repeal  was  drafted  by  the  hand  of  Senator  STEWAET,  of 
Nevada,  and  that  it  was  supported  two  or  three  years  ago  by  the  entire  rep- 
resentation from  the  State. 

"Mr.  FITCH.  Will  the  gentleman  permit  a  correction? 

"Mr.  KERB.  I  will. 

"Mr.  FITCH.  I  wish  to  state  that  the  Legislature  and  people  of  Nevada 
petitioned  Congress  for  a  money  subsidy  for  the  building  of  a  tunnel.  They 
did  not  petition  Congress  to  compel  them  to  pay  for  it. 

"Mr.  KERR.  With  great  respect  toward  the  gentleman  from  Nevada,  I  sub- 
mit that  that  is  an  evasion.  Whether  they  petitioned  for  the  construction  of 
the  tunnel  at  their  own  expense  or  not,  it  is  very  clear  that  they  all  wanted 
this  tunnel.  They  believed  it  to  be  a  good  thing,  and  if  they  wanted  it  built 
at  the  expense  of  the  people  of  the  United  States,  and  not  at  the  expense  of 
the  people  of  Nevada,  I  do  not  think  the  people  of  Nevada  gain  much  by  that 
presentation  of  the  case." 

20.  "The  pretext  that  this  corporation  sets  up  for  assuming  to  in- 

terfere with  the  property  of  the  miners  on  the  Comstock 
lode  is,  that  the  miners  do  not  know  how  to  work  the 
mines,  or  manage  their  own  property  in  the  most  profit- 
able manner." 

The  Sutro  tunnel  does  not  interfere  with  anybody's  prop- 
erty. The  mining  companies  were  anxious  to  have  the  tun- 
nel constructed,  and  made  contracts  accordingly.  It  was 
not  until  the  Bank  of  California  found  that  its  construction 
would  put  a  stop  to  dishonest  mining  and  milling  opera- 
tions that  it  commenced  to  oppose  it. 

21.  "It  is  a  sufficient  answer  to  this  impudent  assumption  to  say, 

that  these  miners  have  bought  and  paid  for  the  mines  they 
work,  and  it  is  none  of  this  corporation's  business  whether 
they  are  working  them  in  the  most  profitable  manner  or 
not.  But  the  assumption  is  not  true.  The  testimony 


20 

taken  by  the  Committee  on  Mines  and  Mining  proves 
that  the  mines  are  being  worked  more  economically  than 
they  could  be  through  this  tunnel  if  it  was  completed." 

The  mining  companies  have  obtained  titles  to  the  mines 
under  a  condition  that  they  fulfill  their  solemn  engage 
ments.  The  legitimate  owners  of  the  mines  will  he  im- 
mensely benefited  by  the  construction  of  the  tunnel,  as  the 
testimony  taken  by  the  Committee  on  Mines  and  Mining 
shows,  and  as  is  reported  by  eight  members  of  that  com- 
mittee. 

(See  Majority  Report  of  the  Committee  on  Mines  and 
Mining,  Testimony,  page  1.) 

22.  "The  history  of  mining  throughout  the  world  shows  no  paral- 
lel to  the  energy  displayed  and  the  success  achieved  by 
the  miners  on  the  Comstock  lode.  They  have  accom- 
plished more  in  twelve  years  than  has  been  done  in  any 
other  country  in  a  century." 

The  history  of  mining  throughout  the  would  shows  no 
parallel  to  the  mismanagement  and  waste  practiced  on 
the  Comstock  lode.  The  management  of  the  mines  has 
been  half  grab,  half  gamble,  and  to  the  great  injury  of 
legitimate  mining.  These  mines  are  known  to  be  the  most 
valuable  in  the  whole  world,  and  if  their  production  has 
reached  the  enormous  sum  of  $150,000,000  in  the  last 
twelve  years,  and  a  yield  in  the  past  year  of  over  $17,000,000, 
it  only  proved  the  immensity  of  the  treasure  contained 
therein,  and  is  no  proof  of  their  judicious  management.  It 
has  been  nothing  but  a  stock  gambling  operation  for  years 
past,  and  the  men  who  manage  the  property  grew  rich  at 
the  expense  of  the  legitimate  owners.  It  has  been  a  search 
for  rich  ores,  while  the  poor  ores  are  left  behind.  Over 
$500,000,000  of  the  lower-grade  ores  have  been  passed  by, 
and  are  now  known  to  exist,  which  will  be  made  available 
by  the  great  reduction  of  cost  and  by  the  advantages  the 
tunnel  will  furnish. 

(See  Evidence,  page  155,  testimony  of  Professor  New- 
comb.) 


21 

"  Q.  Mr.  RAYMOND  [United  States  Commissioner  of  Mining]  goes  on  to 
state: 

"'At  present,  however,  the  tendency  is  more  than  ever  the  other  way.  As 
the  prospects  of  mining  on  the  old  wasteful  plan  grow  darker  and  darker, 
officers,  agents,  and  stockholders  bend  their  energies  to  save  what  they  can 
by  speculation  out  of  the  approaching  wreck.  We  might  well  afford  to  leave 
them  to  their  fate,  but  for  the  fact  that  the  effect  of  the  abandonment  of  the 
Comstock  lode  would  be  almost  fatal  to  systematic  and  permanent  mining  in 
the  Pacific  States.  It  would  confirm  the  mischievous  feeling  that  mining  is 
half  grab  and  half  gamble ;  that  the  only  way  to  make  money  at  it  is  to  dig 
out  what  rich  ore  you  can  get,  and  then  find  a  fool  to  buy  the  property ;  or, 
failing  that,  to  make  a  fool  of  that  collective  individual  the  public,  and  un- 
load yourself  of  your  stock.' 

"  Q.  Would  you  consider  that  about  the  thing? 

"  A.  The  case  is  very  well  put  there. 

"  Q.  You  would  confirm  what  Mr.  Raymond  states? 

"  A.  I  would  confirm  that  most  emphatically,  excepting  the  remark  as  to 
the  running  out  of  the  material ;  I  shouldn't  agree  with  him  upon  that  point. 

"  Q.  Then  he  states  further:  '  The  Sutro  tunnel  will  do  four  most  import- 
ant things:  It  will  settle  the  continuance  of  the  Comstock  in  depth;  it  will 
inevitably  unite  the  mining  companies  in  many  respects,  and  remove  much 
of  the  expense  of  separate  pumping,  hoisting,  prospecting,  and  general  ad- 
ministration ;  it  will  render  possible  the  beneficiation  of  low-grade  ores,  abso- 
lutely the  only  basis  for  rational  and  permanent  mining;  and,  finally,  by 
assuring  the  future,  it  will  kill  that  speculation  which  thrives  on  ignorance  of 
the  future?' 

"A.  I  assent  to  that  proposition. 

"  Q.  Would  the  tunnel  open  up  the  mines  in  such  a  manner  as  to  lay  bare 
the  lode,  that  they  cannot  speculate  any  longer  on  prospective  strikes,  as 
they  do  now? 

"A.  It  would  have  that  tendency  to  a  very  great  degree,  but  it  would  not, 
perhaps,  entirely  do  away  with  speculation.  As  soon  as  the  lodes  were 
thoroughly  explored  to  a  depth  of  2,000  feet,  they  would  acquire  a  knowledge 
of  their  value ;  people  who  deal  in  stocks  would  be  informed;  and,  instead  of 
putting  in  money  simply  as  a  matter  of  speculation,  they  would  purchase  as 
an  investment,  and  instead  of  continually  changing,  the  proprietorship  would 
remain  the  same." 

23.  "They  have  already  penetrated  the  mountain  to  a  depth  below 
the  level  of  the  proposed  Sutro  tunnel,  and  all  they  ask 
is  to  be  let  alone." 

If  some  of  the  shafts  have  reached  the  level  of  the  tun- 
nel, it  will  save  that  from  being  done  after  the  latter  is 
completed ;  for  it  has  been  shown  that  the  benefits  of  drain- 
age, ventilation,  and  transportation  can  only  be  realized 
fully  after  all  the  shafts  are  connected  with  the  tunnel. 


22 

When  that  is  accomplished,  all  above  the  tunnel  can  only 
he  considered  as  surface  ground,  while  the  tunnel  level  will 
present  a  new  "basis  of  operations,  to  penetrate  on  the  lode 
an  additional  depth  of  2,000  feet,  while  without  it  the  limit 
to  which  mining  can  he  carried  has  already  been  reached. 

(See  Evidence,  page  156,  testimony  of  Professor  New- 
comb.) 

"Q.  Now,  in  regard  to  working  the  mines  to  a  greater  depth  below  the 
tunnel  level,  Mr.  Raymond,  in  a  foot-note,  states :  '  The  direct  saving  in  drain- 
age is  doubled  by  the  fact  that  the  water  now  lifted  at  great  expense  by  steam 
would,  if  allowed  to  fall  instead,  itself  generate  a  motive  power  to  take  the 
place  of  steam.  Hydraulic  engines,  utilizing  this  service  of  power,  are  com- 
mon in  the  deep  mines  of  Europe,  but  have  never  been  introduced  in  this 
country.  In  the  case  under  discussion  the  conditions  would  be  extremely 
favorable,  permitting  a  hydraulic  column  of  2,000  feet.  Fifty  gallons  of 
water  per  second,  with  a  fall  of  2,000  feet,  create  a  working  capacity  of  1,800 
horse-power.  Another  way  of  utilizing  the  water  of  drainage  would  be  the 
erection  of  water-wheels  under  ground,  by  which  various  operations  requir- 
ing machinery  could  be  conducted.  This,  too,  is  very  common  in  Europe, 
and,  like  the  use  of  hydraulic  engines,  may  be  introduced  with  advantage 
wherever  there  is  deep  tunnel  drainage.  In  the  absence  of  deep  drainage, 
both  these  economical  devices  of  science  are  out  of  the  question.  If  the  Sutro 
tunnel  is  completed  to  the  lode,  and  connected  with  deep  shafts,  the  conditions 
for  further  explorations  to  still  greater  depths  will  be  more  favorable  than  they 
were  at  the  very  surface,  since  the  immense  power  of  the  hydraulic  column  will 
be  at  the  service  of  the  miner.' 

"Can  you  see  any  difficulty,  Doctor,  in  utilizing  the  water  in  these  mines, 
which  is  stated  to  exist  in  large  quantities  about  the  800-foot  level,  and  car- 
rying it  down  in  pipes  to  the  tunnel  level  for  driving  machinery? 

"A.  There  isn't  any  difficulty  about  it,  and  I  should  consider  it  feasible  to 
accumulate  the  water  upon  these  levels  and  transfer  it  in  tubes,  to  create  a 
power  for  operating  the  mines  to  a  lower  depth  than  2,000  feet. 

24.  "The  objections  to  the  passage  of  the  bill  agreed  upon  by  the 
majority  of  the  Committee  on  Mines  and  Mining  may 
be  very  briefly  stated: 

"First.  It  proposes  to  take  money  from  the  Treasury  to  aid  a 
company  of  speculators  in  an  enterprise  purely  for  their 
own  benefit,  in  which  neither  the  Government  nor  the 
people  have  any  interest  whatever." 

It  proposes  to  loan,  under  the  most  ample  security,  a 
limited  amount  of  money,  to  insure  the  completion  of  a 
work  which  will  benefit  the  Government  and  people  to 
the  extent  of  thousands  of  millions  of  dollars,  by  proving 


23 

the  downward  continuance  of  mineral  lodes  to  great  depths, 
and  thus  giving  an  additional  value  to  our  mineral  domain. 
The  company  is  not  one  composed  of  speculators,  but  of 
honorable,  high-minded  business  men,  and  to  a  large  ex- 
tent of  the  laboring  classes  of  the  State  of  Nevada.  They 
have  invested  a  large  amount  of  their  money,  have  brought 
the  immense  work  to  a  great  state  of  forwardness,  and  now 
ask  such  a  recognition  from  the  Government  as  will  ac- 
knowledge the  national  importance  of  the  work,  and  thus 
insure  the  additional  funds  still  required  from  private 
sources. 

25.  "Second.  In  doing  this  they  propose  to  destroy  the  property 

of  others,  amounting  in  value  to  over  $12,000,000." 

It  has  already  been  shown,  that  not  a  dollar's  worth  of 
property  will  be  destroyed,  and  that  if  some  is  depreciated 
in  value  to  the  extent  of  one  million  dollars,  the  annual 
gain  will  be  over  nine  millions  of  dollars. 

26.  "Third.   The  Government  assumes  the  risk  and  loses  the  two 

millions  it  lends  the  corporation  if  the  scheme  proves  a 
failure,  while  the  corporation  will  reap  all  the  benefit  if 
it  proves  a  success. 

The  Government  assumes  but  a  tithe  of  the  risk ;  nearly 
one  million  and  a  half  has  already  been  expended  upon  the 
work,  and  the  bill  provides  that  at  least  an  equal  additional 
amount  must  be  expended  before  any  loan  is  made.  If 
there  be  any  risk  in  that,  the  people  of  the  United  States 
can  well  afford  to  share  a  small  portion  of  it  with  the  enter- 
prising men  who  have  undertaken  this,  the  most  gigantic 
and  difficult  work  now  in  progress  in  any  portion  of  the 
world,  the  successful  completion  of  which  will  be  pointed 
to  with  a  feeling  of  pride  by  every  citizen  of  the  United 
States,  as  a  great  monument  to  the  enterprise  of  the  age. 

During  3,000  years  of  mining,  the  greatest  depth  to 
which  man  has  penetrated  is  2,700  feet.  What  is  beneath, 
the  human  eye  has  never  seen.  It  remains  for  the  youngest 
nation  in  the  world  to  gain  access  to  a  point  4,000  feet  in 
depth,  upon  the  greatest  and  most  valuable  mineral  deposit 


24 

known  to  history.,  and  thus  contribute  to  the  science  of 
geology,,  practically,  more  than  will  ever  be  derived  from 
superficial  examinations ;  at  the  same  time,  enriching  the 
nation  beyond  calculation. 

(See  Evidence,,  page  153,  testimony  of  Professor  New- 
comb.) 

"  Q.  By  the  bill  now  before  this  committee  it  is  proposed  that  the  United 
States  shall  grant,  as  aid  for  the  construction  of  the  Sutro  tunnel  and  its 
branches,  certain  sums  of  money,  not  to  exceed  in  the  aggregate  $3,000,000, 
the  Government  retaining  a  first  mortgage  or  lien  thereupon,  together  with 
all  engines  and  machinery  and  appurtenances  thereunto  belonging,  for  the 
repayment  of  said  moneys,  and  also  25  per  cent,  of  the  net  amount  which 
shall  be  collected  by  the  Tunnel  Company  as  tolls  for  the  transportation  of 
ore,  rock,  and  material,  or  in  any  other  manner.  From  your  investigation 
and  knowledge  upon  the  subject,  do  you  deem  it  advantageous  to  the  United 
States  to  grant  such  aid;  and  according  to  your  best  judgment,  do  you  be- 
lieve that  such  security  upon  the  property,  franchises,  and  earnings  of  the 
company,  would  be  ample  for  the  payment  of  such  aid  or  loan  ? 

"  Mr.  SUNDERLAND.  I  want  to  have  the  reporter  note  an  objection  to  this. 

"  Mr.  NEWCOMB.  I  should  deem  it  a  safe  investment;  and  if  I  had  $3  000,- 
000  to  dispose  of,  I  would  put  it,  under  these  circumstances,  in  the  tunnel. 

"Mr.  RICE.  And  regard  the  security  as  ample? 

"A.  And  regard  the  security  as  ample;  taking  such  precautions  in  regard 
to  it  as  would  insure  that  the  instrument  be  properly  and  thoroughly  made. 

"Q.  Do  you  or  do  you  not  regard  the  construction  of  the  Sutro  tunnel  im- 
portant in  its  bearings  upon  geological  and  scientific  research  as  an  exploring 
work;  and  if  it  should  successfully  demonstrate  the  downward  extension  of 
fissure- veins  and  the  value  of  deep  mining,  what,  in  your  judgment,  would 
be  its  effect  upon  the  mining  interests  of  the  United  States  and  their  future 
development? 

"A.  Well,  as  an  exploring  work,  I  do  not  know  that  any  superintendent 
differed  in  opinion  from  me,  that  it  might  be  of  very  great  value.  Some  ex- 
pressed their  opinion  that  it  would  be  valuable.  My  own  opinion  is  very 
clear  upon  that  subject,  that  it  would  be  of  very  great  importance  in  a  scien- 
tific point  of  view,  and  it  would  lead  to  similar  enterprises,  under  similar  cir- 
cumstances, with  the  same  character  of  rock.  It  would  demonstrate  whether 
the  ore-bearing  character  of  fissure-veins  extends  downwards  here  as  it  does 
in  other  countries.  It  would  lead  to  further  works  of  a  similar  kind,  to 
develop  the  mining  industry  of  the  country  to  a  vast  extent. 

Respectfully  submitted, 

ADOLPH  SUTRO. 
WASHINGTON,  February  G;  1873. 


.- 


GAYLAMOUNT 
PAMPHLET  BINDS* 


Manufactured  by 
GAYLORD  BROS.  Inc. 
Syracuse,  N.Y. 
Stockton,  Calif. 


